Western Libraries

Is Big Brother Shopping With You?

Written By: 
AV

A recent article published in The New York Times entitled "How Companies Learn Your Secrets" caught our eye here at the Johnston Library, specifically on the topic of marketing analytics. In the article, author Charles Duhigg details how Target Corporation has hired a statistician to analyze the data purchased from other corporations (such as financial institutions) and create a profile of each person who visits their store."For example, American Express uses data mining to suggest products to its cardholders based on an analysis of their monthly spending patterns, and MasterCard International plans to sell a data warehouse of millions of cardholder transactions to its 20,000 business partners, such as banks and Shell Oil." (Marotte)

"For decades, Target has collected vast amounts of data on every person who regularly walks into one of its stores. Whenever possible, Target assigns each shopper a unique code — known internally as the Guest ID number — that keeps tabs on everything they buy. “If you use a credit card or a coupon, or fill out a survey, or mail in a refund, or call the customer help line, or open an e-mail we’ve sent you or visit our Web site, we’ll record it and link it to your Guest ID,” Pole (Target's statistician) said. (Duhigg, New York Times)

Marketing analytics is an ever expanding area of study and one that advertisers are keen to participate in. By monitoring our habits corporations can determine how to market to specific sets of individuals. "Powerful computing systems can collect information about customers and their habits through a loyalty card system, for instance. Algorithms can identify patterns or trends in buying behaviour that can help managers determine which products might appeal to which customers, or when an in-store promotion may be most effective. But it's not a perfect science. Many consumers may simply ignore or opt out of receiving e-mail advertisements from their loyalty card program, for instance."  (Weeks)

Privacy Concerns:

With the onslaught of possible new legislation allowing police to monitor Canadians internet usage without a warrant, the issue of privacy arises. Do these corporations have the right to monitor spending habits and purchase demographic data about consumers?

Many large corporations, especially online retailers, are already collecting innumerable amounts of data about consumers without knowledge or consent. "Technologically, many large internet-based companies are already collecting significant amounts of data on each of their customers, whether the customer knows it or not. This is not only done through direct interaction with the customer, but also through the use of software that not only records information from the web visitor's cookies, but also from diagnostics recording the number of pages viewed, time spent per page viewed, most visited pages and pages continuously re-visited. " (Hauser)

Google: Users of Gmail frequently leave their email open as they surf the web and have noticed targeted ads in their Gmail based on their internet browsing. "Betsy Masiello, a policy manager for Google, wrote that “like most major email providers” Google scans messages for malware as well as for information to “show ads that are relevant to you.” (Jones)

Amazon: Amazon actively collects data on it's customers, determining basket and ticket size and customer habits. "With an estimated 23m customers, Amazon has amassed a vast database" (Kehoe). The cookies on your computer are especially vulnerable -- Amazon uses these to make recommendations to you.

GPS Monitoring:

Many companies are now expanding their information gathering to GPS. If a customer is shopping in a store or a mall and has a cell phone for example, GPS can be activated to monitor the customer's shopping habits. This includes how long a person shops in a particular department and which areas they go to directly after. Some consumers actively participated in GPS monitoring for deals or social media purposes, such as 4square. "The North Face encourages customers to opt in to “geo-fencing” technology, which enables it to reach them when they’re near the store—or even when they’re someplace related to the store, like the slopes or a hiking trail. The app Shopkick uses geo-locating in partner stores like Best Buy and Macy’s to send users redeemable points and coupon offers when they’re in or near those stores. And for the holidays, consumers can expect a handful of retailers to experiment further, combining limited-time-offer psychology with locator technology to promote offers like a two-hour sale or an offer for the first 100 people to the door." (Wieczner)

Books:

Chiu, S., & Tavella, D. (2008). Data mining and market intelligence for optimal marketing returns (1st ed.). Amsterdam: Butterworth-Heinemann.

Clow, K. E., Clow, K. E., & Clow, K. E.Integrated advertising, promotion, and marketing communications (5th; 5th; 5th ed.). Boston; Boston; Boston: Prentice Hall; Prentice Hall; Prentice Hall.

Delahaye Paine, K., Delahaye Paine, K., & Paarlberg, W. T. Measure what matters :Online tools for understanding customers, social media, engagement, and key relationships. Hoboken, N.J.; Hoboken, N.J.: Wiley; Wiley.

Giudici, P., & Figini, S. (2009). Applied data mining for business and industry (2nd ed.). Chichester, West Sussex, U.K.: John Wiley.

Lantos, G. P. (2011). Consumer behavior in action :Real-life applications for marketing managers. Armonk, N.Y.: M.E. Sharpe ;.

Posavac, S. S., & Society for Consumer Psychology. (2012). Cracking the code. Armonk, N.Y.: M.E. Sharpe. 

Articles:

Big brother is watching you as stores seek better data: Retail - BusinessWeek Retrieved 2/21/2012, 2012, from http://news.businessweek.com/article.asp?documentKey=1377-ae15wzlsb_KQ-24V94BV38TB7T273QQOUMT2GL6

Big brother malls trigger privacy row after installing equipment to spy on shoppers via their mobiles | mail online Retrieved 2/21/2012, 2012, from http://www.dailymail.co.uk/sciencetech/article-2082165/Big-Brother-malls-trigger-privacy-row-installing-equipment-spy-shoppers-mobiles.html

Duhigg, Charles. (2012, February 16). How companies learn your secrets. The New York Times, from http://www.nytimes.com/2012/02/19/magazine/shopping-habits.html?pagewanted=all

Hauser, W. J. (2007). Marketing analytics: The evolution of marketing research in the twenty-first century. Journal of Research in Interactive Marketing, 1(1), 38-54. doi:10.1108/17505930710734125

Jones, Steve. (2012, February 12). Microsoft continues sniping at Google's snooping, from http://blogs.wsj.com/digits/2012/02/02/microsoft-continues-sniping-at-google%E2%80%99s-snooping/?mod=WSJBlog

Kehoe, Louise. (2000, December 6).Amazon must set privacy standards: The largest online retailer should show the way with responsible use of customer data. The Financial Times, from: https://www.lib.uwo.ca/cgi-bin/ezpauthn.cgi/docview/248933639?accountid=15115

Magder, J. (2010, Oct 27, 2010). Software allows companies to react to trends, firm says. Postmedia News, pp. n/a. Retrieved from http://search.proquest.com/docview/849245950?accountid=15115

Marotte, B. (1998, Jan 14, 1998). Powerful eye mines the depths of consumer spending: Bertrand marotte explains how companies use information on your purchases to their advantage -- and even your disadvantage. The Ottawa Citizen, pp. C.3-C3. Retrieved from http://search.proquest.com/docview/240126719?accountid=15115

Richmond, R. (11 November 2010, Resisting the online tracking programs The New York Times,

Weeks, C. (2011, June 15). Ads that know you better than you know yourself ; artificial intelligence systems are being developed to thin-slice market segments - and then deploy targeted messages. The Globe and Mail (Canada), pp. B8.

Wieczner, J. (15 October 2010, 15 October 2010). The mall goes high-tech. Smart Money,